Santos Limited’s
(ASX:STO) planned acquisition of Eastern Star Gas Limited
(ASX:ESG) is facing increasing opposition from its takeover targets’ minority shareholders.
Under the $924 million deal launched in July Santos plans to acquire the 80 per cent of Eastern Star Gas that it does not already own.
Ahead of a shareholder vote this Friday the Eastern Star Gas Shareholder Action Group is asking its shareholders to consider rejecting the deal.
The group is understood to oppose conditions of the proposal relating to the offer price and concerns that recent upgrades have not been sufficiently considered in the bid.
Spokesman for the group, Paul Johnson, has told the Australian Financial Review that he believes around one-third of shareholders by number could vote against the transactions.
In the 2011 financial year Eastern Star Gas narrowed its net loss to $4.3 million.
